Debt Free by 30 – this is a dream that a lot of younger people have, especially those who have learned about finances.
younger people would like to be debt free by 30 so that they can feel the
confidence of owning their home, be able to stay at home with their children,
or to be able to start saving for retirement.
Perhaps you are struggling with debt from student loans or credit card debt. Maybe you or your spouse has recently lost a job. Is it realistic to have a goal of being debt free by 30, particularly if you are in your early to mid twenties?
Here are some tips to help you reach this goal:
1. Work hard. This sounds so simplistic, but it is the truth. Many people think of their twenties as still a “time to have fun”, but if you want to be able to pay off debt, you probably should concentrate on getting a good-paying job. Work as many hours as you can, and work overtime if possible. In fact, if your debt or loans are really high, you may want to take on a second job. At least when you are young, you will have a lot of energy for this!
2. Spend Less Money. Every time you go out to eat, you probably blow $20+ that you could be using to pay down your debt. Add up all the little things you waste money on: expensive coffee on the way to work, name brand clothing, high-priced makeup, etc. Then stop spending the money. Every Friday or Saturday night if you go out, you are wasting more money, and time that could be spent working. I’m not saying you can never have fun, but living debt free does require sacrifice.
3. Don’t expect to have the same standard of living as your parents. If your parents live in a beautiful house or condo, with a big-screen television, and brand new cars, realize that they worked for years to get to that point. Many newlyweds or singles make the mistake of wanting to have everything that mom and dad had right away. It’s just not possible, unless you go into debt to do it. Settle for the smaller apartment; put off getting the new car. It is worth it to save the money.
4. Save money. If you do not have a savings account start one now. Online savings accounts typically give you the best rate of return on your money. Put aside a reasonable amount of money ($500-$1000) for a rainy day. Then save more as you are able. Of course, always make paying down your debt your first priority.
It is possible to be debt free by 30 (or 40, or 50!). Do not be discouraged. Remember, you will be benefiting not only yourself, but your family and your children.